A houseboat presents a romantic alternative to Hong Kong's high-rise apartment living, but is it a financially savvy move?

Hong Kong, with its abundance of islands, has a long history of floating communities. The Tanka have been living aboard junks in local waters since the 7th century. Nowadays, modern houseboats and yachts - sometimes referred to as "floating flats" - can be glimpsed around Aberdeen, Gold Coast, Sai Kung and Discovery Bay. However, locals who cast off dry land say their lifestyle comes at a cost.

"Living on a boat is great," says Bob Sears, a Hong Kong resident and boat-owning veteran of liveaboards locally and in Macau. "It really is very nice but it's not necessarily a cheap option." Houseboats depreciate gradually compared to other fixed assets, such that they tend to hold their value over time. In 2004, Sears built his own 60-metre wooden boat in Vietnam with room for eight people to sleep. It took about US$100,000 to build and he has now put it on the market for that same price.

Houseboats typically range in price between HK$1 million and HK$6 million, depending on the size and age of the vessel, and whether it comes with a moorage.

For example, a 600 square foot two-bedroom one-bath boat berthed at the Aberdeen Marina Club is currently advertised for HK$1.2 million, or HK$24,000 a month rent. Over in Discovery Bay, a favourite of families because of its direct walk-up access to the pier, a 2,600 sq ft four-bedroom two-bath ship is going for HK$6 million, or a monthly rental of HK$60,000. When weighing up the prices of houseboats, it is important to consider whether the vessel comes with a berthing slot. Usage rights are complex, as boat owners typically secure a dockside slot under a special class of membership at a local yacht club requiring a debenture. These structures give the boat owner the right to lease a moorage, although the berth remains the property of the Hong Kong government.

Marine industry experts say these berths typically trade at a premium that reflects the acute demand for dockside space in Hong Kong.

In the case of swing buoys, monthly rental rates on the grey market can easily exceed those set by the Marine Department, which technically leases the berths for about HK$2,000 a month. Meanwhile, discussion forums on the internet describe liveaboards as subject to speculative forces similar to the housing market.

"The debenture appreciates (or depreciates) like property. When HK property prices rise, boats become more attractive and their resale value rises. But whether or not it rises enough to offset the depreciation, who knows?" said one contributor on a marine discussion thread posted last year on GeoExpat.

Yacht enthusiasts say huge demand for parking spots is the main reason that liveaboards are not much cheaper than renting an apartment. Stuart Pryke, a boat owner and member of the Hebe Haven Yacht Club, said: "It's dead man's boots. If you want to go for a junk, you have to wait for someone to leave [a yacht club] or for them to move ashore."

District councillor Paul Zimmerman has urged the government to open up more marina space to support the development of the pleasure craft industry and help curb inflationary pressures.

"Normal people can't afford it anymore," he says, referring to moorage costs.

The debenture to join the Aberdeen Marina Club is HK$3.5 million. What's more, you can be years on the waiting list for a club membership - the Discovery Bay Marina Club and Gold Coast Marina and Country Club also provide moorage services for houseboats - and there is no guarantee you will ever be admitted.

But if you are one of the lucky few who is able to find a mooring, what are the maintenance costs for a liveaboard lifestyle? Mooring fees are around HK$4,000 to HK$5,000 per month for a mid-sized boat. Securing water and electricity to swing buoy berthing can require running a cable and other piping along the seabed.

Set-up costs are about HK$70,000. In addition, expect to pay HK$1,500 a month in utility bills. Electricity unit charges can be higher than normal because rates are set by the marinas acting as a third-party supplier.

You will also need a Marine Department licence at a cost of HK$5,000 or more a year, and a survey of the boat before purchase which runs to HK$130 a foot. Transferring the vessel for yard works can set you back HK$50,000. Anti-fouling maintenance works, needed every year, can range between HK$8,000 and HK$15,000. Other maintenance work, such as varnishing the deck, is HK$70 an hour.

Yearly insurance premiums will be approximately 1 per cent of the value of the vessel. Boat insurer Aon estimates annual comprehensive coverage for a boat worth HK$5 million to HK$6.5 million at between HK$40,000 and HK$65,000.

How about from a renter's perspective? James Wendlinger, a photographer, rented rooms on several boats for more than a year in Aberdeen. His average payment was HK$10,000 a month while sharing. He also had to pay additional maintenance costs, including frequent post-storm cleaning.

Because the ship was moored a small way off the Aberdeen pier, he had to hire a local sampan to ferry him back and forth. It could cost as little as HK$5 per trip during daylight hours, but HK$80 to HK$100 late at night. He also had to call and wake up the driver. The journey from the pier to the boat only takes about three minutes, but sometimes wait times could be up to 25 minutes, depending on sampan availability.

In the end, Wendlinger moved back ashore. "The main problem was the sampan, you're dependent on it," he says.

"I don't think I saved anything. You're living in Aberdeen which doesn't have the best public transportation, so you have to factor in taxis at night plus the sampans," Wendlinger says. "But it's a better lifestyle with a better view and better neighbours."

COSTS

Boat: HK$1.2 million

Aberdeen Marina Club debenture: HK$3.5 million

Monthly club fees: HK$990

Boat transfer to marina: HK$50,000

Monthly moorage fee: HK$2,500

Monthly utility charges: HK$1,500

Yearly anti-fouling: HK$10,000

Weekly cleaning: HK$350

Annual marine licence fee: HK$5,000

This article appeared in the South China Morning Post print edition as Home berths